Ending a week of rumors, Google on Monday said it has agreed to acquire YouTube for $1.65 billion in a stock-for-stock transaction.
The acquisition combines one of the largest and fastest growing online video entertainment communities with Google's expertise in organizing information and and its own fledgling video business.
Google said the combined companies will focus on providing a better, more comprehensive experience for users interested in uploading, watching and sharing videos, and will offer new opportunities for professional content owners to distribute their work to reach a vast new audience.
"The YouTube team has built an exciting and powerful media platform that complements Google's mission to organize the world's information and make it universally accessible and useful," said Google chief executive Eric Schmidt.
"Our companies share similar values; we both always put our users first and are committed to innovating to improve their experience. Together, we are natural partners to offer a compelling media entertainment service to users, content owners and advertisers."
When the acquisition is complete, YouTube will retain its distinct brand identity, strengthening and complementing Google's own fast-growing video business, Google said in a statement. YouTube will continue to be based in San Bruno, CA, and all YouTube employees will remain with the company.
Google said the number of its shares to be issued in the transaction will be determined based on the 30-day average closing price two trading days prior to the completion of the acquisition.
The deal is expected to close in the fourth quarter of 2006.
19 Comments
It is a little dangerous for YouTube to be out there by itself with no attachment or protection from a larger company. YouTube now has a better chance of not being over run by a larger competitor.
Inevitably Microsoft is going to take a go at Video itself with MS Live Video or whatever they will call it. MS Live Video will be tied directly into Vista. MS will say its integrated directly into the OS and cannot be removed.
The Google CEO is on the Apple board, but beyond that I don't it impacts Apple at all.
The Google CEO is on the Apple board, but beyond that I don't it impacts Apple at all.
Some had said Apple should buy YouTube (not me, of course)--and now that YouTube is out of the picture, there are really no more large internet sites like that to be spoken for (MySpace, Facebook and now YouTube).
Plus, this may be of interest from an iPod perspective. Maybe a Apple-Google-YouTube alliance that allows some sort of (original, not copyrighted content) video downloading to the iPod? All without the risk of litigation that Google potentially faces now.
Google + YouTube = GooTube
Google + YouTube = GooTube
LOL!
I heard a rumor that Google is in talks with Apple to integrate Google Video support for the iTV device that Apple will launch next year. With the acquisition of YouTube, there will be an even bigger collect of videos for users to stream to their iTV.
I think this is a great move by Google.